8-K

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

November 17, 2005
Date of Report (Date of Earliest Event Reported)

RAVEN INDUSTRIES, INC.

(Exact name of registrant as specified in its charter)

Commission File: 0-3136

South Dakota
(State of incorporation) 46-0246171
(IRS Employer Identification No.)

205 East 6^th Street
P.O. Box 5107
Sioux Falls, SD 57117-5107
(Address of principal executive offices)

(605) 336-2750
(Registrant’s telephone number including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c)under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02. Results of Operations and Financial Condition.

     Incorporated by reference is a press release issued by the Registrant on November 17, 2005 regarding earnings for the third quarter of fiscal year 2006, attached as Exhibit 99. The information filed in this current report on Form 8-K is being furnished pursuant to Item 2.02 of Form 8-K and shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 and Section 11 of the Securities Act of 1933 or otherwise subject to the liabilities of those sections. Furnishing this current report on Form 8-K does not constitute an admission by Raven Industries, Inc. as to the materiality of any information contained in this current report that is required to be disclosed solely by Item 2.02.

Item 9.01. Financial Statements and Exhibits.

(c)      Exhibits.

Exhibit No.	Description
99	Raven Industries, Inc. press release dated November 17, 2005.

SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

Raven Industries, Inc.
 

/s/ Thomas Iacarella  

Thomas Iacarella 

Vice President and Chief Financial Officer 

Date: November 17, 2005

2

EXHIBIT INDEX

Exhibit Number	Description
99	Raven Industries, Inc. press release dated November 17, 2005

3

EX-99

Exhibit 99

RE:	Raven Industries, Inc.
	P.O. Box 5107
	Sioux Falls, SD 57117-5107

FOR FURTHER INFORMATION:

AT THE COMPANY:	AT FINANCIAL RELATIONS BOARD:
Tom Iacarella	Dennis Waite	Leslie Loyet	Tim Grace
VP & CFO	General Inquiries	Analyst Inquiries	Media Inquiries
(605) 336-2750	(708) 246-6265	(312) 640-6672	(312) 640-6741

SIC Codes: 3672, 3081, 3829

FOR IMMEDIATE RELEASE
THURSDAY, NOVEMBER 17, 2005

RAVEN INDUSTRIES ANNOUNCES RECORD THIRD-QUARTER RESULTS

SIOUX FALLS, SD—November 17, 2005—Raven Industries, Inc. (RAVN: NasdaqNM) today reported sales up 11 percent to a record $54.1 million over the year-ago period and net income 32 percent higher at a record $6.9 million, or 37 cents per share vs. 28 cents last year. Excluding the impact of an $820,000 after-tax write-off of an acquisition in the prior year, net income grew 14 percent.

Engineered Films and Flow Controls were the major drivers in the third quarter ended October 31, 2005, noted Raven CEO and President Ronald M. Moquist. “Demand for Raven films was up across our standard product line,” Moquist said, “including agricultural films, pit liners for oil exploration, and the construction markets. Strong initial seasonal orders from OEMs spurred results in our Flow Controls Division.”

On a year-to-date basis, total company sales of $150.1 million were up 21 percent from last year and net income of $18.8 million was 32 percent higher than one year earlier. At $1.03 per share, the nine-month net income exceeded the 97-cent full-year January 31, 2005, record.

Segment Performance
Engineered Films Division (EFD) experienced a 27 percent climb in sales to $23.2 million. Pit lining and construction markets remained strong and sales also benefited from higher selling prices. Disaster film shipments in the just concluded quarter totaled $3 million versus $4 million shipped in the year-ago quarter. October 2005 backlog for disaster films totaled $4 million. Operating income, restricted by the impact of higher resin prices, and higher scrap levels as new equipment came on-

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line, rose eight percent to $5.6 million for the third quarter. For the first nine months of the fiscal year, sales increased 39 percent to $56.7 million while operating income was 22 percent higher than the first nine months of last year at $13.9 million.

Flow Controls Division (FCD) sales rose 21 percent to $12.5 million for the third quarter while operating income increased to $3.6 million from $1.7 million a year earlier, which included a $1.3 million write-off of inventory and intangibles related to its Fluent Systems acquisition. The higher sales level reflects accelerated orders from original equipment manufacturers. Sales of the division’s new sprayer boom-height control product, called Autoboom™, arising from the acquisition of the assets of Montgomery Industries in February 2005, were approximately $400,000 in the quarter. For the nine months, sales were up 21 percent to $37.3 million with operating income reaching $10.9 million. Last year’s nine-month operating income, including the Fluent write-off, was $8.6 million.

Electronic Systems Division (ESD) sales were relatively flat in the third quarter, down two percent to $13.7 million. The division, however, maintained the strong efficiency gains it had made in the first half of the year, posting operating income of $1.9 million, up 18 percent from the level of the year-earlier period. Moquist said that customers requested early delivery of product in the second quarter, which reduced third quarter shipments. For the first nine months of the year, sales totaled $42.3 million, up 21 percent from the same period last year while operating income more than doubled, reaching $6.9 million.

Aerostar sales for the third quarter were down 20 percent to $4.7 million while operating income declined 30 percent to $805,000. Raven management said it expected to receive a bid package for parachutes from the US government in the near future. Moquist said that, even if the bids are successful and new orders arrive, management doesn’t expect any impact on shipments through the first half of next year. For the first nine months, Aerostar sales totaled $13.8 million, down 22 percent from the year-earlier period. Operating income had declined $1.5 million, or 42 percent to $2.2 million.

Balance Sheet
The company’s cash and investment balances were $12.2 million at the end of the quarter versus $8.9 million one year earlier. Operating cash flows for the nine months totaled $15.7 million versus $10.8 million for the comparable period last year as a result of higher net income. Cash used in investing activities increased from $4.0 million to $7.7 million due primarily to the acquisition of Montgomery Industries in February 2005 and additional investments in manufacturing equipment. Dividends in the prior fiscal year included a special $11.3 million dividend paid in May 2004. Regular quarterly dividends are up 27 percent over last year’s levels.

Outlook
Moquist discussed prospects for the fourth quarter along with challenges and opportunities for the coming year. “The fourth quarter outlook remains very strong as we look at ongoing demand for Engineered Films products and expect improved gross margins over last year’s fourth quarter, when Aerostar incurred an operating loss. We recognize that with this year’s exceptionally strong growth in sales and profits we have created a challenge for next year, but we are planning to grow both sales and earnings.”

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About Raven Industries, Inc.
Raven is an industrial manufacturer that provides electronics manufacturing services, reinforced plastic sheeting and flow control devices to various markets.

CONFERENCE CALL INFORMATION
Raven has scheduled a conference call today at 2:00 p.m. Central Time to discuss its fiscal third-quarter 2006 performance and related trends in its business. To access this call, log on to www.ravenind.com or www.vcall.com 15 minutes before the call to download the necessary software. Replays will be available through this website for 90 days.

FORWARD-LOOKING STATEMENTS
The Private Securities Litigation Reform Act provides a “safe harbor” for forward-looking statements. Certain information included in this press release and other materials filed or to be filed by the company with the Securities and Exchange Commission (as well as information included in statements made or to be made by the company) contains statements that are forward-looking. Although the company believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, there is no assurance that such expectations will be achieved. Such assumptions involve important risks and uncertainties that could significantly affect results in the future. These risks and uncertainties include, but are not limited to, those relating to weather conditions, which could affect certain of the company’s primary markets, such as agriculture and construction, or changes in competition, raw material availability, technology or relationships with the company’s largest customers, any of which could adversely impact any of the company’s product lines. The foregoing list is not exhaustive and the company disclaims any obligation to subsequently revise any forward-looking statements to reflect events or circumstances after the date of such statements.

On the Internet, information is available at www.ravenind.com, the company’s website.

FINANCIAL TABLES FOLLOW...

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RAVEN INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except earnings per share) (Unaudited)

	Three Months Ended October 31									Nine Months Ended October 31
							Fav (Unfav)									Fav (Unfav)
	2005			2004			Change			2005			2004			Change
Net sales	$	54,135		$	48,597			11	%	$	150,143		$	124,082			21	%
Cost of goods sold		39,922			35,635						109,887			90,683
Gross profit		14,213			12,962			10	%		40,256			33,399			21	%
Selling, general and administrative expenses		3,645			3,581						11,253			9,916
Loss on disposition of businesses and assets		—			1,282						—			1,282
Operating income		10,568			8,099			30	%		29,003			22,201			31	%
Other income, net		(67	)		(16	)					(121	)		(66	)
Income before income taxes		10,635			8,115			31	%		29,124			22,267			31	%
Income taxes		3,766			2,921						10,324			8,016
Net income	$	6,869		$	5,194			32	%	$	18,800		$	14,251			32	%
Net income per common share:
-basic	$	0.38		$	0.29			31	%	$	1.04		$	0.79			32	%
-diluted	$	0.37		$	0.28			32	%	$	1.03		$	0.77			34	%
Weighted average common shares outstanding:
-basic		18,059			18,077						18,050			18,084
-diluted		18,326			18,429						18,312			18,432

RAVEN INDUSTRIES, INC.
SALES AND OPERATING INCOME BY SEGMENT
(In thousands) (Unaudited)

	Three Months Ended October 31									Nine Months Ended October 31
							Fav (Unfav)									Fav (Unfav)
	2005			2004			Change			2005			2004			Change
Net Sales:
Flow Controls	$	12,544		$	10,409			21	%	$	37,259		$	30,839			21	%
Engineered Films		23,197			18,337			27	%		56,734			40,745			39	%
Electronic Systems		13,692			14,004			(2	)%		42,313			34,829			21	%
Aerostar		4,702			5,847			(20	)%		13,837			17,669			(22	)%
Total Company	$	54,135		$	48,597			11	%	$	150,143		$	124,082			21	%
Operating Income:
Flow Controls	$	3,631		$	1,671			117	%	$	10,934		$	8,566			28	%
Engineered Films		5,632			5,237			8	%		13,935			11,413			22	%
Electronic Systems		1,921			1,629			18	%		6,914			3,104			123	%
Aerostar		805			1,152			(30	)%		2,162			3,706			(42	)%
Total Segment Income		11,989			9,689						33,945			26,789
Corporate Expenses		(1,421	)		(1,590	)		11	%		(4,942	)		(4,588	)		(8	)%
Total Company	$	10,568		$	8,099			30	%	$	29,003		$	22,201			31	%

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RAVEN INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands) (Unaudited)

	October 31		January 31		October 31
	2005		2005		2004
ASSETS
Cash, cash equivalents and short-term investments	$	12,215	$	9,619	$	8,903
Accounts receivable, net		29,435		25,370		24,293
Inventories		25,458		23,315		22,273
Prepaid expenses and other current assets		3,209		3,288		2,841
Total current assets		70,317		61,592		58,310
Property, plant and equipment, net		22,112		19,964		17,458
Other assets, net		9,746		6,953		6,329
	$	102,175	$	88,509	$	82,097
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current portion of long-term debt	$	11	$	57	$	70
Accounts payable		8,623		10,322		6,280
Accrued and other liabilities		11,635		10,571		9,654
Total current liabilities		20,269		20,950		16,004
Long-term debt, less current portion		12		—		5
Other liabilities		1,461		1,477		1,383
Shareholders’ equity		80,433		66,082		64,705
	$	102,175	$	88,509	$	82,097

RAVEN INDUSTRIES, INC.
CONDENSED CONSOLIDATED CASH FLOWS
(In thousands) (Unaudited)

	Nine Months Ended October 31
	2005			2004
Cash flows from operating activities
Net income	$	18,800		$	14,251
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		3,634			2,846
Deferred income taxes		(455	)		68
Loss on disposition of businesses and assets		—			1,282
Other operating activities, net		(6,287	)		(7,690	)
Net cash provided by operating activities		15,692			10,757
Cash flows from investing activities
Capital expenditures		(5,409	)		(4,016	)
Acquisition of businesses		(2,803	)		—
Other investing activities, net		506			(5	)
Net cash used in investing activities		(7,706	)		(4,021	)
Cash flows from financing activities
Dividends paid		(3,791	)		(14,308	)
Purchase of treasury stock		(1,038	)		(2,019	)
Long-term debt principal payments		(55	)		(54	)
Other financing activities, net		—			106
Net cash used in financing activities		(4,884	)		(16,275	)
Effect of exchange rate changes on cash		(6	)		—
Net increase (decrease) in cash and cash equivalents		3,096			(9,539	)
Cash and cash equivalents at beginning of period		6,619			14,442
Cash and cash equivalents at end of period		9,715			4,903
Short-term investments		2,500			4,000
Cash, cash equivalents and short-term investments	$	12,215		$	8,903

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